Bank of Greece Forecasts Gradual Inflation Decline, Steady Growth

According to the BoG report, inflation, measured by the Harmonized Index of Consumer Prices (HICP), is expected to decrease gradually, approaching 2% by the end of 2026. However, introducing the ETS2 carbon trading system in the energy sector is anticipated to cause a temporary increase to 2.5% in 2027. Core inflation is projected to drop to 2.2% by 2027, driven by lower industrial goods and services inflation.

The Bank of Greece (BoG) projects that Greece’s inflation will settle at 2.5% in 2025, slightly exceed 2% in 2026, and then rise again to 2.5% in 2027.

According to the BoG report, inflation, measured by the Harmonized Index of Consumer Prices (HICP), is expected to decrease gradually, approaching 2% by the end of 2026. However, introducing the ETS2 carbon trading system in the energy sector is anticipated to cause a temporary increase to 2.5% in 2027. Core inflation is projected to drop to 2.2% by 2027, driven by lower industrial goods and services inflation.

Greece’s economy is forecast to grow by 2.5% in 2025 and 2.3% in 2026, outpacing the eurozone average. This growth will be fueled by investment spending (supported by EU funds) and private consumption, which benefits from rising real disposable income. Factors contributing to this include employment growth, wage increases, minimum wage hikes, and lower inflation.

Exports are expected to grow at an average annual rate of 3.8% between 2025 and 2026. However, increased imports, driven by strong investment activity, are projected to negatively contribute to GDP from the external sector.

Source: pagenews.gr